Tuesday, August 19, 2014

La oferta, la demanda y los cigarrillos

From the textbook, to the marketplace, as the professors teach it;
Sales of tobacco products in Spanish tobacconists and bars have dropped dramatically in the last five years, according to the Finance Ministry and the cigarette industry.
By about half, from over 90 billion ten years ago, to 47 billion smokes today;
The trend can be attributed to tougher anti-smoking legislation, tax hikes and a loss of consumer purchasing power as a result of the economic crisis. This in turn has led to a spike in tobacco smuggling and a search for cheaper alternatives, such as roll-your-own cigarettes and pipe tobacco.
Consumers are also turning to low-cost cigarettes, whose makers have been thriving and already control a share of over 11 percent of the market.
Also to an ages old solution;
According to a KPMG study commissioned by the four largest cigarette manufacturers ... 8.8 percent of all tobacco consumed in Spain is smuggled in. If you also take into account the 15 packs that a person can legally bring in from the tax-free principality of Andorra, just north of Catalonia, on each visit, the proportion of tax-free cigarettes smoked in Spain is now over 11.3 percent, compared with 2.5 percent in 2009.
 Qué sorpresa.

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